Judgment in Managerial Decision Making, 8th Edition

CHAPTER ELEVEN

Negotiator Cognition

The decision-analytic approach to negotiation presented in the previous chapter suggests that it is desirable for parties to strike an agreement whenever a positive bargaining zone exists. Why, then, do negotiators frequently fail to settle? The decision-analytic approach also provides strategies for reaching agreements of great value to both sides. Why, then, do even negotiators who have access to this advice fail to reach Pareto-superior outcomes?

This chapter explores the most common cognitive mistakes that people make in negotiation. Specifically, we will look at six key issues that affect negotiator cognition: (1) the mythical fixed pie of negotiation, (2) the framing of negotiator judgment, (3) the nonrational escalation of conflict, (4) overestimating your own value, (5) self-serving biases, and (6) anchoring biases. Each section illustrates how the decision-making processes of the typical negotiator diverge from a prescriptive model of behavior and discusses how we as negotiators can correct these deviations.

An understanding of these common mistakes will help improve your negotiating skills in two key ways. First, awareness is an essential step toward avoiding these errors in important negotiations. Second, once you have learned to identify these errors in your own behaviors, you will be better able to anticipate them in the decisions of other negotiators.

THE MYTHICAL FIXED PIE OF NEGOTIATION

Why do negotiators so often fail to reach ...